The invention relates to a novel incentive and compensation plan for motivating and rewarding employees, and a computer system for implementing said plan.
Effective employees are important to the success of any business. Understanding this, businesses are continuously searching for ways to attract and retain employees who are self-driven, efficient, and productive. One known method for doing so is to provide incentive plans for rewarding those employees who meet or exceed certain performance criteria with cash or non-cash bonuses.
Many known incentive plans reward employees with bonuses in the form of shares of company stock. Stock-based incentive plans are effective, especially with respect to managers, since they provide employees with an opportunity to share in the growth potential of a company, and give employees the incentive to foster the company's growth. However, these known stock-based incentive programs reward employees based on their individual performance. They do not reward employees based on the performance of the company, or on the performance of the company's stock. As a result, existing stock-based incentive plans poorly align the interests of the employee and the interests of the company's shareholders.